Among Brazilian families with overdue accounts, 77.4% of them had credit cards as their main type of debt. These data are from the National Confederation of Trade in Goods, Services and Tourism (CNC).
Despite this negative index, knowing how to make conscious use of a credit card has benefits. It is a safe way to pay for your purchases, facilitates installments and allows for the accumulation of miles, which can be exchanged for products and services.
So here are 5 secrets not to turn this financial instrument into a trap!
1. Avoid paying only the minimum invoice amount
Much of the number brought to the beginning of this text is explained by the high interest charged to those who do not pay the full amount of the invoice. Although rates fell in November 2018, they still average 275% per year.
That is, who pays only the minimum of the invoice pushes to the following month the remaining amount, plus such exorbitant interest. Gradually, this amount becomes priceless and leads the consumer to default.
In order not to fall into this trap, never let the temptation of minimum value beat you! With such high interest rates, the card bill should be a priority expense.
2. Debit the invoice
Another way to escape interest is not to delay the due date by sheer oblivion. With so many bills and obligations in the routine, this is normal.
The best way to prevent such problems is to register the invoice at debit preferably on a date that coincides with the receipt of your salary.
3. Never lend the card
You certainly think twice about lending someone money, don’t you? As much as the person is a relative or close friend, the fear of never seeing the color of money again is justified.
Such reasoning must be extended to the credit card. In a way, lending the card is worse than lending money. If the person defaults, it will be necessary to honor the payment with own resources to avoid the incidence of interest. In addition, the loan compromises your available limit and hinder the planning of other purchases.
4. Beware of installments
Although the installment on the card is almost always interest-free, avoid this option. Whenever possible, prefer cash payment and try to negotiate discounts. If it is inevitable to split the purchase, do so in a few installments and include the expense in the budget for the following months.
5. Don’t consider the limit as part of your income.
In addition to interest, the card offers another pitfall for those who don’t have so much control over spending: the feeling of not spending money while shopping. So be careful and don’t consider the limit made available as part of your monthly income. Without it, the chance of the invoice exceeding your earnings is enormous. Keep a maximum of two cards and, if applicable, request a reduction in the limits for your control.
Conscious use of credit card is a fundamental part of a healthy financial life. This way, it becomes an excellent ally in maintaining a day to day organized budget.
What do you do not be surprised by your card bill the following month? Tell us your experience in the comments!